Financial Bubble Spreads To The Philipines, Where Markets Are Soaring Despite Terrible Economy

MANILA - The buoyant Philippines' stock market, which has almost doubled in the past nine months, might suggest a similarly lively economy, yet government stimulus spending is failing to make a dent in the jobless rate, and economic growth is barely showing. The Philippine Stock Exchange PSEi Index has surged from below 1,800 in mid-March to over 3,000. Yet 2.9 million Filipinos of working age were unemployed as of July, with the unemployment rate rising to 7.6% that month from 7.4% a year earlier, according to the National Statistics Office. Workforce participation was at 64.6% against 64.3% for the same period last year. The economy is expected barely to grow this year, possibly between 0.8% and 1.8%, before recovering to between 2.6%-3% in 2010. "What is recovering is the stock market, mainly the financial sector," said Rene Ofreneo, a labor and industrial relations expert and executive director of the multi-sectoral Fair Trade Alliance. "Right now, only the call centers are hiring, but even that is not at the rate that was originally projected."